US, European and Japanese stocks surged and risk-sensitive currencies such as the Aussie and Kiwi dollars rose as traders celebrated a US trade deal with Japan with lower tariffs than feared, and signs of a similar one for Europe.
In our deep dive interview, ANZ Senior Commodities Strategist Daniel Hynes analyses why a 50% tariff on US copper imports may not help rebuild its domestic copper industry.
5 things to know in 5 minutes:
US and European stocks and more risk sensitive currencies bounced overnight after news Japan secured a 15% tariff deal with the US, versus the 25% rate initially proposed, says ANZ Head of G3 Economics Brian Martin. There’s also signs a better European deal is imminent with the same 15% rate, not the 30% Trump threatened.
ANZ Senior International Economist Tom Kenny says the lower-than-expected tariff rate will be a positive for Japanese exporters.
Part of the deal requires Japan to open access to US exporters in areas like agriculture and autos. Tom says a third key plank is a requirement for Japan to invest US$550 billion into the US.
The deal now brings into question the future of Japan’s Prime Minister after his ruling party lost its majority in the Upper House, to go with its current minority in the Lower House as well.
Singapore’s annual inflation rate stayed at 0.8% in June, slightly below market expectations, says ANZ Head of Asia Research Khoon Goh.
Cheers,
Bernard.
PS: Catch you tomorrow with a look at how US manufacturing is performing.
